Applied Finance: Snap Inc. Share Structure, Stock Indices, and POV

This report analyzes the share structure of Snap Inc., detailing the different classes of shares (A, B, and C) and their associated voting rights. It examines how the company has raised funds through various share types, including convertible preferred and non-convertible shares. The report further explores the impact of stock indices on Snap's stock, particularly Class A shares, and how fluctuations in the market affect the company's value and publicity. Additionally, it presents a point of view from Matt Levine regarding shareholder options and the challenges faced by the company, emphasizing the risks and long-term plans. The analysis draws upon the Q3 2017 Earnings Report, providing insights into the company's financial structure and market dynamics.

Running Head: APPLIED FINANCE 0
Applied Finance
(Student Name)

APPLIED FINANCE 1
Table of Contents
Share Structure of Snap...................................................................................................................2
Impact of Stock Indices...................................................................................................................2
Point of View...................................................................................................................................2
References........................................................................................................................................4

APPLIED FINANCE 2
Share Structure of Snap
The company Snap has raised its funds from the market through issuing different type of
shares. It helps the organization to spend huge amount on their business to grow. The company
has issues convertible preferred share as well as non-convertible stock share. The company also
raises its funds by offering voting preferred share as well as non-voting common stock for the
individual who are not interested in the internal activities of the company. Therefore, the share
structure of the company is mixed in which different type of preference shares are issued in the
market. The company majorly focuses on the preference shares rather than on equity shares to
the certain extent. The company has three class of stock which includes Class A, Class B and
Class C
Class A: such shares does not include any votes therefore, the shareholder who purchase
them will be entitles to attend the annual meeting of the company.
Class B: Such stock is reserved for executive of the organization as well as for the earlier
investors. Such shares each some with one vote apiece
Class C: It is held exclusively by the co-founder of the company in which their shares
come with 10 cotes apiece.
Class C is considering as the special share due to the reason the shareholder can be
eligible for 10 voting rights. In general it is expected to have one voting right. They have great
rights to the ownership of the company above such of the common shareholders.
Impact of Stock Indices
It is one of the statistical measures that represent the changes in taking places in the stock
market. The fluctuation in the stock indices created great impact over the market value and
demand of the company. Class A stock greatly affected from fluctuation in the stock index as it
adversely affected the publicity of the company. For example in July 2017, it has been stated that
the company with the multiple Shares class will not be eligible for certain indexes as a result,
Class A stock will likely not be eligible for such indexes.

APPLIED FINANCE 3
Point of View
According to Matt Levine, the shareholder of Snap Inc. has no other option left rather
than to accept the long term plan of the managers. The company is struggling in the recent years
and managers has taken certain steps for the long term benefits. T is quit risky for the
shareholder however, they have to accept the decision of the company whatever they would take.
Shareholder is at risk. There is no other option and solution occurs for the “short-termism”
debate (Levine, 2017).

APPLIED FINANCE 4
References
Levine, M. (2019). Proxy Fights and Mystery Trusts Also estate taxes, quants, Snap and ether
wallets. Retrieved from: https://www.bloomberg.com/opinion/articles/2017-11-08/proxy-
fights-and-mystery-trusts